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Guest column: The plan for Boulder's energy future

By Heather Bailey

Posted:
10/14/2012 01:00:00 AM MDT

In the 11 months since Boulder voters said yes to exploring municipalization, the city has been moving forward with one of the most rigorous analyses in our community's history. Drawing on the extensive research conducted last year, and with input from stakeholders, we have created a work plan that we'd like to share.

The plan builds on several important steps that have already been completed. I became the executive director of energy strategy and electric utility development in June and have held frequent meetings with community members about their objectives and concerns. We have negotiated and signed contracts with outside attorneys to assist in the legal processes that will refine the costs of acquiring Xcel Energy's system. We have charted a range of legal strategies in an attempt to minimize our litigation risk. We have also assembled our staff team and identified the types of engineering specialists we need.

Now, we are entering the next phase of critical work. Over the next several months, staff and consultant work groups, with input from local experts, will be conducting detailed analyses of the factors that matter most to our community, including resource mix, rates, reliability and risks. Our timeline is aggressive. The goal is to develop a well-vetted recommendation -- grounded in our community's priorities -- for City Council's consideration in February 2013.

The work groups are already tackling many important issues. These include:

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Defining metrics to evaluate the two key questions that voters expect us to answer. Can the city create an electric utility given the requirements spelled out in the Charter? And then, perhaps more importantly, should the city create an electric utility? If we are going to have a conversation about one path versus another, we need to agree on reasonable measurements. (The City Council is expected to vote on proposed metrics on Oct. 16).

Quantifying what "cleaner energy" and more renewables means. We will be developing resource mix options, exploring power purchase agreements and weighing possible tradeoffs depending on how fast we want to reach our goals.

Identifying the infrastructure and staffing necessary to guarantee reliability for our customers. This will encompass day-to-day service and emergency response.

Assessing the risks associated with staying with Xcel Energy, either as the status quo or under a new partnership, compared to creating our own utility. The truth is there are risks -- financial, environmental, legal and technical -- with both options. The city discusses some of these risks in more detail at BoulderEnergyFuture.com (click on Risk Analysis in the left menu).

Delving into the factors behind the rates Xcel Energy charges and ensuring that our financial model is robust enough to handle possible new information about the costs of creating and operating a utility. We know we will need to explain initial rates and how future rates will be set and managed.

Lastly, determining from engineering and financial perspectives the specific assets the city would need to acquire from Xcel Energy to create the utility of the 21st century.

This last point is especially important because our desire to change the way we approach Boulder's energy supply is why we began this conversation in the first place. Our community is committed to charting a new vision around energy use and generation -- to be environmental stewards, to minimize our reliance on energy imports and to secure our economic future. How we do this is also a critical component of our efforts to avoid greenhouse gas emissions that are unhealthy and put our planet in peril.

City and community research so far suggests that creating a municipal utility -- and deciding ourselves what a new business model should look like -- is the best way to get there. However, we owe it to potential future customers to be sure. That's the goal of our work plan.

On a final note, I want to thank you for giving me such a warm welcome. I have been incredibly impressed by the expertise and innovation in Boulder. While I realize not everyone has the interest or time to devote to this project, I invite those who can to participate and help us make this a balanced process. Please fill out the comment form at BoulderEnergyFuture.com and indicate what area interests you most. We are committed to sharing as much information as we can without jeopardizing the city's ability to succeed in related legal proceedings. We welcome your involvement.

Heather Bailey is executive director of energy strategy and electric utility development for the City of Boulder.

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